In view of the central government’s proposal that “The
house is used for living, not for speculation”, the rising market of China’s
real estate market has been flattened. However, the reflection on the impact of
China’s real estate investment on the real economy cannot be ignored. Through
the econometric regression model, this paper analyzes the impact of China’s
real estate prices on processing trade by using random and double fixed
effects. The results show that: there is a
strong correlation between housing prices and processing trade; there is
a significant inverted U-shaped relationship between house prices and
processing trade, and the corresponding inflection point prices of the negative
impact of house prices on processing trade are calculated; and the impact of
house prices on processing trade in the east, the middle and the west is
significant. The crowding out effect of housing prices on processing trade in
the east is the most significant, followed by the west, and finally in the
central region. Therefore, the central region has formed a good low-lying land effect of processing trade transfer. The high quality destination of processing trade should be the
central region. A deep understanding of the impact of housing prices on
processing trade and employment driven by processing trade is of great
significance for maintaining and consolidating the traditional advantages of
China’s processing trade and promoting the development of the central and
Western sub regions.
References
[1]
Bi, G. (2019, May 29).Guard against the Crowding out Effect of Housing Price Rebound on Residents’ Consumption. Taihang Daily.
[2]
Carroll, C. D., Otsuka, M., & Slacalek, J. (2006). How Large Is the Housing Wealth Effect? A New Approach (Working Paper No. 12746). National Bureau of Economic Research. https://doi.org/10.3386/w12746
[3]
Cheng, B. (2018). Crowding out Effect of High Housing Prices on Manufacturing Industry and Its Prevention. Social Scientist, No. 3, 70-77.
[4]
Economic Daily (2019, June 24). Housing Is Closely Related to Economic and Social Development (007).
[5]
Harris, R., & Arku, G. (2006). The Housing and Economic Development Debate Revisited: Economic Significance of Housing in Developing Countries. Journal of Housing and Built Environment, 21, 377-395. https://doi.org/10.1007/s10901-006-9056-3
[6]
Huang, J., & Tu, M. Z. (2009). Real Estate Wealth and Consumption: Evidence from Household Micro Survey Data. Management World, 7, 35-45.
[7]
Huang, Z. L. (2018, May 12). How Much Crowding out Effect of Real Estate Boom on Residents’ Consumption. Securities Daily.
[8]
Iacoviello, M. (2012). Housing Wealth and Consumption. In S. J. Smith (Ed.), International Encyclopedia of Housing and Home (pp. 673-678). Elsevier Science. https://doi.org/10.1016/B978-0-08-047163-1.00129-6
[9]
Li, C. F., Liu, J. J., & Qi, X. Q. (2018). Research on the Long-Term and Long-Term Impact of Real Estate Prices on the Consumption of Urban Residents in China. Financial Theory and Practice, 39, 104-110.
[10]
Li, C., Xie, J. z., & Wu, C. (2013). Real Estate Investment and Manufacturing: Promoting Effect or Crowding out Effect—An Empirical Analysis Based on Nonparametric Point by Point Regression. Financial Economics Research, 28, 39-48.
[11]
Luo, Z., & Zhang, C. C. (2015). Credit Expansion, Real Estate Investment and Resource Allocation Efficiency of Manufacturing Sector. Financial Research, No. 7, 60-75.
[12]
Mehra, Y. P. (2001). The Wealth Effect in Empirical Life-Cycle Aggregate Consumption Equations. Economic Quarterly Federal Reserve Bank of Richmond, 87, 45-68.
[13]
Mills, E. S. (1987). Has the United States Over invested in Housing? Real Estate Economics, 15, 601-616. https://doi.org/10.1111/1540-6229.00406
[14]
Rong, Z., & Wang, W. C. (2014). Rising House Prices and Enterprises Entering Real Estate: A Study Based on the Data of Non Real Estate Listed Companies in China. Financial Research, 4, 158-173.
[15]
Rong, Z., Wang, W., & Gong, Q. (2016). Housing Price Appreciation, Investment Opportunity, and Firm Innovation: Evidence from China. Journal of Housing Economics, 33, 34-58. https://doi.org/10.1016/j.jhe.2016.04.002
[16]
Shi, H. l. (2018). Empirical Analysis of Real Estate Price and Economy—Based on Cross-Sectional Data Analysis of Commercial Housing Sales and GDP of 30 Provinces. Times Economic and Trade, No. 20, 57-58.
[17]
Wu, C. M. (2019, August 3). Reducing the Crowding out Effect of Real Estate and Accelerating the Conversion of New and Old kinetic Energy. Securities Daily (A03).
[18]
Wu, H. M. (2012). Asset Price Fluctuation, Inflation and Industrial Hollowing Out: An Empirical Study Based on Panel Data of Private Industries in Coastal Areas of China. China Industrial Economy, 4, 46-56.
[19]
Yang, L. (2018). Does the Development of Real Estate Financial Market Crowd out Manufacturing Industry?—An Analysis Based on the Yangtze River Delta Region. Financial Economy, No. 16, 135-136.
[20]
Zeng, S. H., Zou, P. Y., & Niu, H. X. (2019). Has High Real Estate Prices Squeezed out Service Consumption?—Threshold Model Based on Panel Data in China. Consumer Economy, 35, 42-50.
[21]
Zhang, C. T. (2007). Wealth Effect of Real Estate in China: An Empirical Analysis Based on Data from 1987 to 2005. World Economic Situation, 11, 79-82.
[22]
Zhao, J. P. (2020). Spillover Effect of Housing Price Rise on Urban Residents’ Consumption—Based on the Nonlinear Perspective of Gregory Hanse. Business Economics Research, No. 4, 67-70.
[23]
Zheng, D. Y., Pi, J. C., & Liu, Z. B. (2019). China’s Housing Price Rise and Real Economy Investment: Pull Effect or Crowding out Effect? Financial Review, 11, 1-13+124.
